Sovereign Immunity: Takeaways From the First Successful Defense

Posted by Stuart Duncan Smith on Apr 11, 2017

As previously discussed, we recently led the first successful defense against an IPR on the basis of sovereign immunity. Already, two other state universities are seeking dismissal of IPRs on that same basis: NeoChord v. University of Maryland (IPR2016-00208) and Reactive Surfaces v. Toyota (IPR2016-01914 & IPR2017-00572). As patent owners consider whether to assert the sovereign immunity defense to IPR, they should keep in mind several key lessons we found useful.

Don’t Neglect the Work that Needs to be Done: Although sovereign immunity is a viable defense to IPR, patent owners must do more than merely mention the concept to avoid IPR. Each case presents unique facts requiring a tailored approach. Furthermore, the order dismissing the IPRs against our client is not precedential, so patent owners that present an incomplete or uncompelling case may find that a different panel simply does not agree that sovereign immunity applies to IPR. Patent owners must still do the work to make sure that the sovereign immunity defense succeeds.

Follow the Caselaw: The defense of sovereign immunity is grounded on a large body of caselaw, including the Supreme Court and Federal Circuit caselaw that led to the dismissal of the IPRs against our client. As patent owners face new circumstances, the caselaw will often provide answers.

Gather Needed Evidence: The challenge for many patent owners will be proving that they are entitled to assert the defense of sovereign immunity. Careful analysis of the patent owner’s relationship to the state will often be necessary. For example, who controls the patent owner, how it is funded, and who or what benefits from its operation are all relevant questions. Whether the patent owner prevails may turn on how carefully these issues are presented to the Board.

Move Quickly: Sovereign immunity is an immunity from suit, so a patent owner entitled to raise that defense may do so before having to submit a preliminary response. As we experienced, the Board can delay the deadline for the preliminary response as it considers the motion to dismiss without running afoul of the statutory deadlines. Moving before the preliminary response means that the patent owner saves the expense of preparing a substantive response and avoids going on the record about the prior art in the petition.

The sovereign immunity defense to IPRs is an emerging field with many questions remaining to be answered. These lessons from the first successful case lay a strong foundation for patent owners looking to assert that defense in the future.

This blog will be following the developments in the field of sovereign immunity and IPR, so be sure to subscribe to receive the latest news.

Topics: Sovereign immunity

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This blog is intended to promote thought and debate on developing areas of the law. The opinions, commentary and characterizations of cases provided on this blog are not legal advice and do not represent the opinions of Wolf Greenfield or its clients.